# Clarification Regarding Stock Split

**URL:** <https://forum.alpaca.markets/t/clarification-regarding-stock-split/16633>\
**Category:** Getting Started with Alpaca\
**Created:** [April 1, 2025, 2:24pm UTC](https://forum.alpaca.markets/t/clarification-regarding-stock-split/16633 "2025-04-01T14:24:31Z")\
**Posts on this page:** 2\
**Page:** 1

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**Author:** ![GursimarSinghMiglani](https://sea2.discourse-cdn.com/flex020/user_avatar/forum.alpaca.markets/gursimarsinghmiglani/32/7120_2.png) [@GursimarSinghMiglani](https://forum.alpaca.markets/u/GursimarSinghMiglani)\
**Post date:** [April 1, 2025, 2:24pm UTC](https://forum.alpaca.markets/t/clarification-regarding-stock-split/16633/1 "2025-04-01T14:24:31Z")

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Hi all, I’m currently analysing contract notes for a client, and I came across this value in the description field: “REMOVE, From QTY:-300, To QTY:100, Position Value:1261.5”, and also: “ADD, From QTY:-300, To QTY:100, Position Value:1261.5”, in front of stock splits. What do these mean precisely? Thanks

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**Author:** ![Dan\_Whitnable\_Alpaca](https://sea2.discourse-cdn.com/flex020/user_avatar/forum.alpaca.markets/dan_whitnable_alpaca/32/1658_2.png) [@Dan\_Whitnable\_Alpaca](https://forum.alpaca.markets/u/Dan_Whitnable_Alpaca)\
**Post date:** [April 3, 2025, 12:49pm UTC](https://forum.alpaca.markets/t/clarification-regarding-stock-split/16633/2 "2025-04-03T12:49:58Z")

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@GursimarSinghMiglani What happens when a company declares a stock split? There are two types of stock splits and they are handled differently.

A ‘forward’ split happens when a company _increases_ their outstanding shares. As an example with a 1:2 forward split, the existing shares stay the same but the shareholder is simply given 1 extra share for each share they already hold. This will show up as a single ADD line in activities.

A ‘reverse’ split is a bit more complicated and happens when a company effectively _decreases_ their outstanding shares. There isn’t a process to ‘take back’ shares from shareholders, so the company first cancels all their existing shares (leaving those shares worthless), and then second gives each shareholder new shares (with a new CUSIP). In the case of a 3:1 split they would give each shareholder 1 share for every 3 shares they originally owned.

It appears the example in the post was a 3:1 reverse split? The first entry removes the existing shares and the second entry replaces those with fewer new shares. The entries are a bit obscure, but that is what’s going on.